27063.pdf

Office of the Secretary
Service Date
September 23, 1997
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF A PROPOSAL BY CITIZENS
TELECOMMUNICATIONS COMPANY OF IDAHO
TO IMPLEMENT OPTIONAL CALLING PLANS
FROM ITS HOMEDALE, WILDER AND PARMA
EXCHANGES TO CALDWELL AND NAMP A.
IN THE MATTER OF THE PETITIONS
REQUESTING EXTENDED AREA SERVICE (EAS)
BETWEEN HOMEDALE AND WILDER
EXCHANGES AND CALDWELL AND NAMP
EXCHANGES.
IN THE MATTER OF THE PETITIONS
REQUESTING EXTENDED AREA SERVICE (EAS)
BETWEEN P ARMAIWILDER AND CALDWELL.
CASE NOS. CTC-97-
GNR-93-
GNR-93-
ORDER NO. 27063
In 1993 the Commission received two Petitions (Case Nos. GNR-93-7 and
GNR-93-11) from customers in the Homedale, Wilder and Parma exchanges requesting toll-free
extended area service (EAS) calling to Nampa and Caldwell. Citizens Telecommunications
Company ofIdaho provides local exchange service in the Homedale, Wilder, and Parma exchanges;
US WEST Communications provides local exchange service to the Caldwell and Nampa exchanges.
After the conclusion of several intervening cases, the Commission convened a public hearing in the
two EAS cases.
Following the public hearing, Citizens submitted tariff revisions on June 2, 1997
proposing a new local calling plan from the three Citizens exchanges to the two U S WEST
exchanges. At its public decision meeting of July 8, 1997, the Commission expressed several
reservations concerning Citizens' proposal. The Commission urged Citizens and U S WEST to
refine the proposal. On September 12, 1997, the companies submitted a revised proposal for our
consideration in this matter. Following our review of the record and the testimony received during
our public hearing, we approve the revised plan implementing EAS.
ORDER NO. 27063
PROCEDURAL BACKGROUND
When the two EAS Petitions from Homedale, Wilder, and Parma were filed, these
exchanges were served by GTE Northwest. After the Commission initiated its EAS investigations
GTE requested permission to sell 18 telephone exchanges (including Homedale, Wilder, and Parma)
to Citizens. Given the sales transaction and the Commission s statewide EAS docket (Case
No. GNR-93-13), action on the two EAS Petitions was deferred until the Commission completed
the sales case and established statewide criteria for the implementation ofEAS. With the conclusion
of these intervening cases, the Commission resumed its consideration of the two Petitions.
On January 29, 1997, the Commission issued a Notice of Hearing scheduling technical
and public hearings in these EAS cases. The Commission also consolidated the two cases into a
single proceeding. The Commission made Citizens and U S WEST parties and granted intervention
to AT&T Communications of the Mountain States.
On April 8, 1997, Citizens, U S WEST and the Commission Staff filed their direct
testimony. Although Citizens acknowledged a community-of-interest among these exchanges, it
stated it could not implement an affordable EAS or local calling plan until the end of 1997 or early
1998. On April 29, 1997, the Commission convened a public hearing in these cases in Wilder
Idaho. Numerous customers appeared and expressed their desire for EAS calling to the Caldwell
and Nampa exchanges as soon as possible.
CITIZENS' CALLING PROPOSAL
On June 2, 1997, Citizens submitted tariffrevisions (Advice No. 97-05) that proposed
a local calling plan as an alternative to EAS calling from the three Citizens exchanges to the two
US WEST exchanges. Citizens moved to suspend the technical hearing scheduled for July 1997.
Citizens' proposed plan provided three "one-way" calling options to the Caldwell exchange and the
same three calling options to the Nampa exchange but at different rates.
1. To Caldwell . Under Citizens' plan , the premium flat rate option would allow
unlimited calling from the Citizens exchanges to Caldwell for an additional payment of $8.00 per
month for residential customers and $11.00 per month for business customers. The second option
(measured service) would provide local calling at a measured service usage rate of$0.05 per minute
with flat rate elements of$4.00 per monthforresidential customers and $5.50 per month for business
ORDER NO. 27063
customers. The third option would be to continue the status quo-calls between the exchanges
would continue to be rated as toll calls, at whatever rates are charged by the customers ' toll carriers.
2. To Nampa. Citizens proposed the same three options from the Citizens exchanges to
the Nampa exchange. The premium flat rate option would be available at $7.00 per month for
residential customers and $10.00 per month for business customers. The measured service option
would be offered at $3.50 per month for residential customers and $5.00 per month for business
customers at the same $0.05 per minute usage rate. The third option would be the present toll
calling. Citizens proposed that the Nampa options and the Caldwell options be purchased
separately-but customers could purchase both options. Calls to either U S WEST exchange would
be placed using the normal seven digit dialing pattern. Billing under the measured service option
would not include call detail, but this information would be available at an additional charge of $1.
per month plus $0.10 per page.
In Order No. 26999 issued June 12, 1997, the Commission granted Citizens' Motion to
Suspend the technical hearing and ordered that the calling plan be processed under Modified
Procedure in Case No. CTC-97-3. The Commission invited interested persons to submit written
comments on Citizens' proposal no later than June 28 , 1997. The Commission received seven
comments.
THE COMMENTS
The Commission received comments from Citizens, Staff, U S WEST, the Homedale
School District and three individual customers. The School District and one customer simply
requested that the Commission hold a hearing on the proposal. Another customer voiced support
for maintaining the status quo, and the other customer supported the optional calling plan so long
as EAS will continue to be considered. The remaining comments are discussed below
1. U S WEST.The Company filed comments objecting to the proposal and indicated
that Citizens had not discussed the proposal with US WEST. US WEST identified a number of
billing and technical issues that were unresolved. It also objected to the "one-way" EAS routes
(from the three exchanges to Nampa or Caldwell only) and observed that the plan provided toll-free
calling to only two exchanges out of the eleven exchanges in the Treasure Valley local calling
regIOn.
ORDER NO. 27063
U S WEST noted that calls from Caldwell and/or Nampa to Homedale, Wilder or Parma
would still be toll calls. U S WEST maintained that Citizens cannot unilaterally implement a two-
way calling plan with U S WEST exchanges. The Company indicated that it does have an optional
discount calling plan (City Connection Plan), which may alleviate some of the costs of making toll
calls between these regions.
2. Citizens. Citizens stated that the proposal offers customers some immediate relief
from large toll bills by providing customers with a choice. Citizens indicated that it would pay
US WEST access charges for all calls terminated within US WEST's exchanges. Citizens also
commented that the information necessary to reach a decision on an ultimate local calling solution
is simply not available at this time and several complex issues are yet to be resolved. Citizens
insisted that customers should not be denied the benefits of this proposal while those issues are
resolved. Finally, Citizens confnmed its intention to review its overall rate restructure early in 1998
and file a new rate design.
3. Staff.Staff recommended that the Commission approve the optional calling plan
a temporary and interim solution to the needs expressed by the customers in these exchanges.
Concurrent with the approval, Staff recommended that the Commission allow Staff to continue
working with the Company to develop a lasting solution. Staff's willingness to endorse the optional
calling plan was predicated upon Citizens presenting the information necessary for a full revenue
and rate review in the first quarter of 1998. That information will determine the economic impacts
of granting EAS on these routes. Staff declared that it is not possible to accurately determine an
appropriate charge for granting permanent EAS until a thorough review is completed.
At the decision meeting held July 8, 1997, the Commission expressed reservations
concerning the "one-way" nature ofthe EAS options and the classification of calls from the Citizens
exchanges to Caldwell and Nampa. More specifically, the Commission questioned whether these
calls are to be considered toll or local calls for purposes of compensation. At the decision meeting
U S WEST disclosed that it and Citizens had agreed on the terms of the billing between the two
companies. Consequently, U S WEST withdrew its objection to the proposal but remained
V S WEST also offers another discount calling p1an-Toll-Pac.
ORDER NO. 27063
concerned about other issues. The Commissioners declined making a final determination in this case
and urged Citizens and U S WEST to resolve the remaining concerns.
THE COMPANIES' UPDATE
Following prolonged discussions between Citizens and US WEST, they succeeded in
resolving a number of the outstanding issues. As a result of these discussions, the companies filed
a letter with the Commission on September 12, 1997. In the letter, U S WEST agreed to expand its
Treasure Valley regional calling area to include the Citizens exchanges of Parma, Wilder and
Homedale at no additional cost to U S WEST customers. However, Citizens continued to prefer that
EAS be limited to only calling between the three exchanges and the Nampa and Caldwell exchanges.
Although US WEST and Citizens have not reached an agreement as to the scope ofU S WEST
cities which will be included in the offerings, the companies are nevertheless willing to allow the
Commission to make the decision as to which U S WEST exchanges are to be included in the
(Citizens-U S WEST) EAS." Joint letter at 2. U S WEST was concerned that ifthe Commission
limits the Citizens EAS calling to just Nampa and Caldwell, this may create conditions that promote
illegal EAS arbitrage for calls from the Citizens exchanges to other U S WEST exchanges in the
Treasure Valley region. For example, an entity may offer to complete calls from the Citizens
exchanges to any exchange other than Nampa and Caldwell without paying access charges, e., the
Upper Valley case.
The letter also noted that Citizens and U S WEST are currently negotiating a local
interconnection agreement that will include mutual compensation arrangements for the exchange of
traffic on Commission-approved EAS routes. Pending completion of the interconnection agreement
the parties have agreed to interim terms and conditions for termination of traffic on the requested
routes in order to assure that implementation of EAS is not delayed pending the ongoing
negotiations. "Until the negotiated agreement is finalized, calls on the routes ordered by the
Commission in this case will be compensated through the payment of terminating switched access.
The interim arrangement will commence on the date of implementation of EAS and continue for 180
days." Joint letter at 2. If the parties have not fmalized their agreement, then all traffic after the 180-
day period will terminate on a "bill and keep" basis until such time as the parties agree to terms for
ORDER NO. 27063
mutual compensation. The parties estimated that they can implement two-way EAS in 120 days.
Id.
FINDINGS
Given the agreement of the parties, we find it is reasonable to adopt Citizens' calling plan
as modified by the parties for three primary reasons. First, we find this optional calling plan gives
customers a choice of calling options but does not force them to participate in mandatory EAS.
Second, the optional calling plan is an effective way to provide immediate relief to customers while
the companies develop a permanent solution. Third, the modified plan offers customers two-way
calling.
To avoid adverse impact to Citizens, we further find that it is reasonable to limit the
calling plans to only the Caldwell and Nampa exchanges. Consequently, U S WEST shall restrict
the two-way EAS from only Caldwell and Nampa to the three Citizens exchanges. US WEST or
the Staff shall advise us immediately if they discover arbitrage activities involving the three Citizens
exchanges and other U S WEST exchanges in the regional calling area. The Commission also adopts
the parties' compensation arrangements.
The companies shall implement the optional calling plan as soon as possible. Citizens
and U S WEST shall advise the Commission within 21 days from the date of this Order when EAS
can be fully implemented.
ORDER
IT IS HEREBY ORDERED that Citizens Tariff Advice No. 97-05 in Case No. CTC-
97-3 is approved as modified by the parties and adopted above. We order Citizens and US WEST
to implement the optional calling plan as quickly as possible but in no case later December 31 , 1997.
IT IS FURTHER ORDERED that US WEST and Citizens advise the Commission within
21 days of when EAS can be implemented.
THIS IS A FINAL ORDER. Any person interested in this Order (or in issues finally
decided by this Order) or in interlocutory Orders previously issued in these Case Nos. CTC-97-
GNR- T -93- 7 and GNR - T -93-11 may petition for reconsideration within twenty-one (21) days of the
service date ofthis Order with regard to any matter decided in this Order or iIJ. interlocutory Orders
ORDER NO. 27063
previously issued in these Case Nos. CTC-97-, GNR-93-7 and GNR-93-11. Within seven
(7) days after any person has petitioned for reconsideration, any other person may cross-petition for
reconsideration. See Idaho Code ~ 61-626.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this
~.,;??~
day of September 1997.
HANSE , PRESIDENT
~JJ
--* ~ -
RALPH NELSON, COMMISSIONER
MARSHA H. SMITH, COMMISSIONER
ATTEST:
Myrna J. W ite
Commission Secretary
vldJO:CTC- T -97-3 .
ORDER NO. 27063